Home electrical fires
In 2009, an estimated 44,800 home structure fires reported to U.S. fire departments involved some type of electrical failure or malfunction as a factor contributing to ignition.  These fires resulted in 472 civilian deaths, 1,500 civilian injuries, and $1.6 billion in direct property damage.  

Three Prong outlets improperly wired (no ground provided)
Ungrounded circuits are converted to accept a newer 3 prong outlet. This gives the illusion that the receptacle is grounded but is not. Properly grounded outlets allow stray current to travel to the earth ground if a malfunction occurs.

Hot-Neutral Reverse
This is another commonly found issue during a home inspection where the receptacles are improperly wired that has the polarity of the outlet is reversed. This means the small slot on the receptacle that should be the hot is now the neutral and the large slot is hot which should be the neutral. This creates the potential for shock.
         

“Homeowner” wiring (or is it Uncle Bob?)
Performed by homeowners or handymen they hired there is usually several signs of unprofessional work performed. Inspectors find, hanging wires, open junction boxes, splices not in boxes, inadequately sized wires and/or switches. During the home inspection I will find improperly wired 3 way switches, fixtures and devices.

Extension cords used as permanent wiring
Extension cords are used all the time. They should never be considered permanent wiring. Extension cords should never be installed under rugs or covered. Excess cord should not be bundled or rolled up when in use. They should periodically inspected to make sure they are not warm, overheated, brittle, cracked or damaged. Extension cords have “gauges” that should be properly sized for the load required. Undersized cords are a fire danger.

Oversized Fuses or Breakers
The fuse or breaker is supposed to be the weakest link in the circuit. If there is a “situation” you want the fuse to blow or the breaker to trip.  By increasing the size of the breaker or fuse the homeowner has not increased the power to the circuit. They now have made the wiring in the wall or device the weakest link and could cause a fire. Think of it as turning the wires in the wall into heating elements.

Single Strand Aluminum Wiring
Houses built between 1960 and 1973 could have some single strand aluminum wiring. There was a copper shortage during this time which made copper more expensive. The inexpensive substitute was aluminum. The problem was that aluminum wiring expands and contracts at a different rate than copper. The devices that were connected to it were not designed to handle this causing loose connections that lead to fires. Aluminum also corrodes when it is in contact with copper. Needless to say there are tens of thousands of homes that have aluminum wiring. Replacement is the best option but may be expensive. There are approved connectors but need to properly installed to ensure they will work.   CPSC- Repairing aluminum Wiring